NEW diesel cars are taking a third of sales and despite a dip last month, registrations for this year are heading for a record, say the car makers.

NEW diesel cars are taking a third of sales and despite a dip last month, registrations for this year are heading for a record, say the car makers.

But the hike in interest rates is now likely to bring about a dramatic slowdown in sales.

It is the first fall in the new car market since May and the Society of Motor Manufacturers and Traders believe more than 2.56 million new models will be registered by the end of the year to create a new record.

Last month, diesels hit 29.7% of market share and the most popular small and super-mini models dominated the top-10 chart.

Although eight in 10 new cars bought are now imported, it is private buyers who are pushing the business with 48% of retail sales in the total.

Daewoo recorded a staggering 500% increase in registrations compared with 12 months ago.

Ford took almost 15% of the business, just ahead of Vauxhall's 13% but Renault, Volkswagen and Peugeot stayed in single figures and the two French companies along with Citroen have seen sales collapse, by half in the case of Citroen.

"These records are underlined by private buyers, taking nearly 50% of the market so far this year. However, with the expected rise in interest rates, we are likely to see the market ease over the next few months."